Cosco eyes scrubbers ahead of sulphur cap

Liu Gang, executive director of Cosco Shipping International, expects a large part of the parent’s fleet to be fitted with the exhaust gas cleaning devices in the run-up to the deadline for the IMO’s sulphur rules.

News ID: 80181

Date: 25 August 2018 - 09:15

Chinese giant is considering installing scrubbers on its ultra-large container ships, according to source close to the company

CHINA Cosco Shipping Group, known as Cosco Shipping, will opt for scrubbers to meet the International Maritime Organization’s sulphur regulations, according to a senior executive from the state conglomerate’s shipping service arm.

“I think a larger portion of Cosco Shipping’s fleet will go with scrubbers to deal with the 2020 sulphur cap,” Liu Gang, executive director of Cosco Shipping International, told Lloyd’s List.

Services of Hong Kong-listed CSI range from ship trading, supply of bunker and marine equipment to the production of marine coatings, a large part of which are provided to its own parent’s fleet.

Mr Liu said the company was also considering the other two solutions — low sulphur fuel oils and liquefied natural gas as marine bunker — but their applications were relatively complex.

“For LSFO, sufficient supply is an issue, especially in the remote areas,” he said. He added that the refiners were also hesitant when facing high costs in upgrading the production equipment and large uncertainties in users’ demand.

Mr Liu said CSI was studying the LNG bunkering markets, although he admitted that the technologies used in this business were very complicated.

Cosco Shipping, the owner of one of the world’s largest merchant fleets, has not made clear its position on the solutions to IMO’s sulphur rules.

That contrasts with Maersk, which has openly voiced its support for LSFOs while several other big names, such as Mediterranean Shipping Co, have chosen to fit scrubbers to their vessels.

Nevertheless, the Chinese giant announced in June that its shipbuilding subsidiary Cosco Shipping Heavy Industries agreed to team up with Japan’s Mitsubishi Heavy Industries on a pilot project to install the exhaust gas cleaning system on one of its large ocean-going vessels.

A source close to Cosco Shipping’s container line business said the company was currently considering fitting scrubbers to its ultra-large containerships and this should bear fruit between this year and next.

Mr Liu said despite the apparent preference for scrubbers so far, no final plan had been settled on by the parent group with regard to how to comply with 0.5% sulphur limit.